MB0049 - PROJECT MANAGEMENTROLL NO.: 1408011810

Ques. 1 Write Short notes on:

a) PERT Model

Answer :

PERT Model

PERT – Program Evaluation & Review Technique – It is generally used for those projects where time required to complete various activities are not known as a priori. It is probabilistic model & is primarily concerned for evaluation of time. It is event oriented.

Measures of variability

Variability in PERT analysis is measured by variance or its square root, i.e. standard deviation. Variance of a set of numbers is the average squared difference of the numbers in the set from their arithmetic average. A simple example may be given to illustrate the calculation of variance. Let us take a series that consist of numbers 4, 6, and 8. The average of this series is 6.

The differences of various numbers in the series from this average are -2, 0, and 2. Squaring them we get 4, 0, and 4. Hence, the variance – the average of squared difference – is 8/3 and standard deviation is √8/3.

The steps involved in calculating the standard deviation of the duration Office No. critical path are as follows:

Step 1: Determine the standard deviation of the duration of each activity on the critical path.

Step 2: Determine the standard deviation of the total duration of the critical path on the basis of information obtained in step 1.

In order to determine the standard deviation of the duration of an activity, we require the complete probability distribution of the activity distribution. We, though, have just three values from this distribution: tp, tm, and to. In PERT analysis, a simplification is used for calculating standard deviation. It is calculated by the formula:

b) CPM model

Answer :

CPM Model

For projects considered uncertain, the PERT model was developed and for projects which are comparatively risk-free the CPM model was developed. Both the approaches start with the development of the network and a focal point on the critical path. Tthe PERT approach is 'probabilistic' while the CPM approach is 'deterministic'. This does not, however, mean that in CPM analysis we work with single time estimates. Actually the main focus of CPM analysis is on variations in activity times as a consequence of changes in resource assignments. These variations are planned plus related to resource assignments as well as are not caused by random factors outside the control of management as in the case of PERT analysis. The major focus of CPM analysis is on time cost relationships and it seeks a project schedule that minimises total cost.

Assumptions

The usual assumptions underlying CPM analysis are:

1. The costs associated with a project can be divided into two components: direct costs and indirect costs. Direct costs are incurred on direct material and direct labour. Indirect costs consist of overhead items like indirect supplies, rent, insurance, managerial services, etc.

2. Activities of the project can be expedited by crashing which involves employing more resources.

3. Crashing reduces time but enhances direct costs because of factors like overtime payments, extra payments, and wastage. The relationship between time and direct activity cost can be reasonably approximated by a downward sloping straight line. Below figure depicts a typical cost time line.

Fig. : A Typical Cost Time Line

Procedure

Given the above assumptions, CPM analysis seeks to examine the consequences of crashing on total cost (direct cost plus indirect cost). Since the behaviour of indirect project cost is well defined, the bulk of CPM analysis is concerned with the relationship between total direct cost and project duration. The procedure used in this respect is generally as follows:

Step 1: Obtain the critical path in the normal network. Determine the project duration and direct cost.

Step 2: Examine the cost time slope of activities on the critical Pathan Street, obtained and crash the activity which has the least slope.

Step 3: Construct the new critical path after crashing as per step 2. Determine project duration and cost.

Step 4: Repeat steps 2 and 3 till activities on the critical path (which may change every time) are crashed.

Ques. 2 Define project type organization and discuss in detail.

Answer :

Project-Type Organisation

In a project-type organisational structure, the employees work for different projects in a team-like structure. Examples are construction companies, where different teams work on different projects.

Teams are put together for a project. Each project is headed by a project leader. Each team will have employees to suit its demands and complete the project successfully. Only employees with requisite

specialised skills are considered for project teams. These members of project team will join back their parent company once the project gets finished.

Fig. : A Typical Organisational Chart of Project-Type Organisation

In project-type organisational structure, each project is handled like a small company. All the essential resources and paraphernalia needed to execute projects are procured for full-time till the project closes out. Employees having specialised knowledge and exposure to similar project environment will be appointed on contractual terms to work in a group and deliver the project expectations.

Advantages Of Project-Type Structure

Clear line of authority: The project manager has complete authority over the project. All the members of the project team are responsible only to the project manager.

level of commitment: The project team has a separate and strong identity, and all members are committed to the project and to each other strongly.

Swift decision making: Because the authority is only with the project manager, the capacity to make swift decisions is increased.

Simple and flexible: Project-type organisations are structurally flexible and simple, which makes them comparatively easy to implement.

Disadvantages Of Project-Type Structure

Duplication of effort: Each project team is fully staffed, which can result in a duplication of effort in every area from clerical staff to technological support.

Cost inefficient: The project organisation structure can be costinefficient because of underutilization of resources or stockpiling equipment for future use.

Stretching out work during slow periods: During slack times, team members may not work at high level of productivity.

Low level of knowledge transfer: There is low level of knowledge transfer between projects as employees are committed to working only on one project. So, there is no source of knowledge transfer and shared functional expertise.

Job insecurity: At the completion of a project, the employees may be fired if there is no similar type of project.

Examples of Project-Type Organization

Rapid transit projects

Construction projects

IT projects

Below figure depicts the project organisation structure of a company selling rapid transit projects.

Fig. : Project Organisation Structure of a Company Selling Rapid Transit Projects

Ques. 3 Answer the following questions:

a) Mention the steps involved in a competitive bid.

Answer :

Competitive bid

The steps involved in competitive bid are discussed below:

1. The bid or tender is invited from a required number of suppliers. Below table depicts a typical structure of bid.

S.N. Particulars Supplier’sResponse

1. Name and address of suppliers2. Buyer’s reference3. Specification (suggest charge, if

any)4. Quantity and delivery (suggest

charge, if any)5. Price and firm price period6. Supplier’s inspection clause, (third

party, buyer’s inspection,own inspection)

7. Terms of payment-advance/credit for 30 days/cash ondelivery/through bank

8. Excise duty/sale tax9. Mode of dispatch (goods

train/truck)10. Lead time (order to receipt Office

No. goods)

2. The bid received in prescribed condition are accepted and held in safe custody.

3. The bids are opened and made public at the stated time and place in the presence of the bidders who are present.

4. The information received from bidders is tabulated on a comparative statement which allows comparison of quoted prices, validity periods, and other critical factors.

b) Mention the elements/points that must be kept in view when designing , developing and operating a PMIS (Project Management Information System)

Answer :

Project Management Information System (PMIS)

Project Management Information System (PMIS) is the system tools and techniques used in project management to deliver information. Project managers use the techniques and tools to collect, combine, and distribute information through electronic and manual means. PMIS is used by the upper and lower management to communicate with each other. It is a Management Information System (MIS) related to a project. A PMIS consists of people, equipment, and procedure to collect, process, store, combine, and communicate the needed information to users (stakeholders) for carrying out project management functions.

Project Management Information System (PMIS) helps in planning, executing and closing project management goals. Project managers use PMIS for budget framework such as estimating costs at the time of planning process. Furthermore, the PMIS is employed to build a specific schedule and classify the scope baseline. The project management team collects information into one database while executing the project management goals. It is used to compare the baseline with the actual achievement Office No. each activity, manage materials, collect financial data, and keep a record for reporting purposes. The PMIS is used to assess the goals to ensure if the tasks were accomplished when project is closed after that, it is employed to make a final report of the project close. To understand this concept better, we should first understand the distinction between data and information.

Data

Data are values of qualitative or quantitative variables belonging to a set Office No. items. They represent something in the real world, expressed as a number or a statement or a picture and act as an input to MIS.

Information

Information may be defined as, (i) data within a context, (ii) data in a relationship, or (iii) processed data. It does not convey much. But, when we say it denotes an age of a student of a class, it gets some meaning. Log Office No. daily production figures in a year do not convey much. But when we calculate their average, standard deviation, range, and trend, we get much more meaning out of them.

System

A system consists of a set of sub-systems/components that work together to achieve a common goal. It comprises of interacting or interdependent components forming an integrated whole.

Ques. 4 Discuss the major contents of the project’s final report

Answer :

Prepare Final Project Report

The final Project Report (PR) should be written by the project manager himself. The PR should present project evolution, its success, its management, any outstanding and team recommendation.

Frigenti et al quotes Meredith and Mantel on the intents of the project final report as, “The final report is not another evaluation, rather it is the history Office No. the project. It is the chronicle of the life and times of the project, a compendium of what went right and what did not, who served the project in what capacity, what was done to create the substance, and how it was managed”. The contents of the final report presented by various authors differ widely. Based on these, the suggested contents of a final PR are given below:

Evolution of project: Narrate the various activities undertaken from project selection, planning, execution, control, and termination phase; problem faced, what went well, what did not, and why.

Overall success of the project: Some typical criteria to measure the overall success of the project are given below:

Business objectives: Restate the business objectives as given in the business case including any changes incorporated later. Comment on how far these objectives have been or likely to be met.

Project efficiency: State the actual cost, resource, and schedule against the plan as shown in the below table

Cost (Lacs of Rs.) Human Resource (Man days)

Schedule (days)

OriginalBaselineActual

Variance

Closure statement: State the circumstances under which the project is being closed as one of the following:

The project has been successfully completed.

The project has been terminated prior to the completion. In this case, describe the reason for termination.

Outstanding issues and deliverables: List any issues or key deliverables not yet accepted. For each, give:

The nature of the issue and reason of non-acceptance

Proposed resolution (include date, person responsible)

Managing of projects: How the project’s different phases were managed? Specifically, comment on the following aspects:

Quality of decision making (fact based, timeliness, etc)

Use of tools/techniques in selection, planning, and control phase

Use of best practices

Lessons learnt and recommendations: A number of insight and innovative methods have been adopted in tackling the various problems. These should be recorded for posterity. Specifically, the following aspects are to be covered:

What worked well and why?

Recommend methods, processes, procedures, best practices, and tools which can be gainfully used in the future.

Identify the areas where time, money, or resources could have been better utilised.

Acknowledgement: Acknowledge all the individuals who have made special contributions to the project.

Release all resources – materials, equipment, and people

On completion of the project, all resources – materials, equipments, and people – are to be released from the project. Equipment and materials are simply released to stores or suppliers. But release of people needs special attention. People have made significant contribution to completing the project. This should be kept in mind while reassigning assignments to them.

Usually they can be returned in any of the following manner:

They may be absorbed in the client’s organisation

They may be reassigned jobs in the organisation and department from which they were borrowed

They can be simply let off

Early communication about reassignment of people is helpful. In any case, the project manager should ensure that the people are released in a fair and proper manner.

Organising Closure Meeting

Once the project manager is satisfied that the project is complete in all respects, he or she fixes a date in consultation with other stakeholders to organise the closure meeting. The primary objectives of this meeting are:

Get formal agreement of the sponsor

Recognise the specific individuals and the team for making valuable contribution

Acknowledge the contribution made by all

Formally close the project

A typical Agenda for the closure meeting is given below:

Welcome by project manager

Summary of the project including major achievement, business benefits, major obstacles faced, impact of project on stakeholders, and lessons learnt.

Outstanding issues: Review outstanding issues, indicate persons who will resolve the issues.

Post-implementation review: Indicate the terms of reference, persons accountable, team members, and time table.

Recognition of team members: Recognise the specific contributions made by individuals and team and present awards to them.

Formal acceptance: Get formal acceptance of the sponsor by signing the certificate of acceptance.

Acknowledgement and formally closing the project: Thank the customer, sponsor, stakeholders, and team for their effort and contributions to achieve a success. Declare the project as closed.

After The Closure Meeting

Finalise the project closure report

Prepare a communication enclosing the approved closure report to the sponsor, project team, and stakeholders, confirming the decision to close the project

Feedback any suggested process improvement to the relevant project office and/or process support group

Ques. 5 Write short notes on

a) Role of risk management in overall project management

Answer :

Role of Risk Management in Overall Project Management

Risk analysis and management is a process which enables the analysis and management of the risks associated with a project. Properly undertaken, it will increase the likelihood of successful completion of a project to cost, time, and performance objectives. There are a lot of benefits of proper risk management in projects. Organisations can generate a lot of profit if they deal with uncertain project events in a proactive manner. You can deliver a project on time, on budget, and with proper quality if you are able to manage the risks properly. The proper risk management can increase the productivity and efficiency of the project team.

A project life cycle includes the key phases like initiating, planning, executing, controlling, and closing. The probability of project risk depends on the project life cycle. Below figure depicts the relationship between the risks and their probability of happening.

Fig. : Probability of Risks versus Stages of Project Life Cycle

Below figure, explains the probability of risk in different stages of project life cycle. It shows that the probability of risks is higher in the initial phases in comparison to closing phases. The highlighted point shows the maximum probability of risk happening.

In comparison to probability of risk, the impact of risks is opposite. The impact of risks is less in the initial stages of a project life cycle and higher in the closing phases. Below figure depicts the impact of risks on various stages of a project life cycle.

Fig. : Impact of Risks Versus Stages of Project Life Cycle

In above figure, the highlighted point shows the maximum impact area of a project life cycle.

b) Quality assurance

Answer :

Quality Assurance

Quality assurance means all the systematic and planned activities executed within the quality system give confidence that the project will meet the applicable quality standards. It also comprises the examination of data at stations and centres to validate that the data are in line with the quality system goals, and to identify errors so that the required action could be taken on time. A quality system should incorporate procedures

that allow to feed back into the measurement and quality control process to avoid the errors from occurring again. We can apply quality assurance in real-time post measurement, and can also feed into the quality control process for the subsequent process of a quality system, but usually it tends to operate in non-real time.

Quality assurance tests make use of a system of metrics to decide whether or not the quality plan is progressing in an acceptable manner. You can measure project quality with customer satisfaction effectively by using both qualitative and quantitative metrics. These tests or quality audits will assist you in forecasting and verifying the accomplishment of goals and identify need for corrective actions. Additionally, quality assurance tests will also help you in mapping quality metrics to quality goals, thereby allowing you to report on quality status at periodic project review meetings.

In most cases, quality assurance provided by a quality assurance department or similarly titled organisational unit, but it is not mandatory that only these departments do this. Quality assurance may be provided to the team managing the project. It may also be provided to the management Office No. the performing organisation (internal quality assurance) or it may be provided to the customer and others not actively involved in the work of the project (external quality assurance).

Inputs To Quality Assurance

Apart from the quality management plans and operational definitions discussed under inputs to quality planning, the inputs to quality assurance includes the following:

Results of quality control measurements: These are the records Office No. quality control testing and measurement for comparison and analysis.

Tools And Techniques For Quality Assurance

Quality audit: It is a structured review of other quality management activities. Quality audit may be carried out by properly trained in-house auditors or by third parties such as quality system registration agencies.

Outputs From Quality Assurance

Quality improvement: It includes all the actions taken for increasing the effectiveness and efficiency of the project to provide added benefits to the project stakeholders.

Ques. 6 What are the common features of project management software?

Answer :

Common Features available in Most of the Project Management Software

Before knowing the practical use of project management software, we should study some of the common features available in most of the project management software. An attempt is made to present an overview Office No. generic features associated with various project management software packages available today. These generic features include:

Data Entry Features

Project data and calendar: A project start date is specified. A calendar can be used to define the working days and hours for each individual resource on a project. The calendar is used in calculating the schedule for the project. Most systems provide a default for the standard working period, such as Monday to Friday from 8:00 AM to 5:00 AM, with an hour for lunch. The calendar can be modified for each resource.

For example, work hours can be modified, company holidays can be entered as non-working days, and various shifts can be entered.

Human resources: Suppose a particular activity needs 2 unskilled person and 1 skilled person to complete the task. These two resources may be entered separately and will appear as 2L and 1S on activity description in network.

Table : Types of Resources and Amount Available

Labour cost: One of the many ways to specify labour cost is as,

Skilled worker – $ 2.0

Unskilled worker – $1.2

Human resources available: All software requires periods and amount of resources that are available for the project.

Cost of construction materials: Materials needed for each task and their estimated costs for the project may be as given below:

Table : Materials needed and Estimated cost is to be Entered Against each Activity

Activity identifier: Each activity of the project is assigned a code or identifier.

Activity description: Each activity has a description. The number Office No. characters should be within the number of characters specified by the software for the activity name field.

Precedence relationship: There are various options to show the linkage between two consecutive activities in a network. One common option is Finish-Start type. It means that the succeeding activity can start only if all preceding activities to it have been completed. This option (Finish-Start type) is the default option in all project management software today for linking two activities.

Below figure depicts the various options for linking activities. These are quite useful in reflecting the real-world situation in network.

Fig. : Various Options to Link Activities

Data entry error: All good management software contains error detection routines that identify and reports errors. However, there are certain errors which cannot be detected by software. These include:

An incorrect activity duration

An incorrect activity name

An Incorrect precedence logic

An Incorrect cost data

A wrong resource entered

These errors have to be corrected manually by listing of the activity records.